Happy Friday market watchers.
On the AUD front it is a bit more of the same as the Australian Dollar traded in a wide range this week amid continuing coronavirus uncertainty and mixed market sentiment.
Have you noticed petrol under $1 per litre (yeah fill that tank up); while this is great for us individually, it has seen the AUD exchange rates come under pressure as a collapse in US oil prices spooked investors and prompted them to shy away from the commodity linked currency.
A recovery in oil prices later in the week saw the Aussie Dollar’s fortunes quickly improve.
This risk-on mood allowed the AUD to rally against the majority of its peers in spite of Thursday’s preliminary PMI figures (Purchasing Managers Index – which for those playing at home is a measure of the prevailing direction of economic trends in manufacturing) reporting a dramatic slump in Australian economic activity in April.
Australian Dollar (AUD) Weekly Review
- AUD/USD trading at: 0.6362 – Down over a cent on the week’s high
- AUD/GBP trading at: 0.5099 – Up almost a cent on the week’s low
- AUD/EUR trading at: 0.5864 – Up over a cent on the week’s low
- AUD/NZD trading at: 1.0602 – Up almost 2 cents on the week’s low
*Rates shown are market rates, not available to the public. Rates are current as at 23 April 2020.
What’s happening next week that will likely affect the Australian Dollar
The Australian Dollar will remain closely tied to market sentiment (no real surprises here).
Investors will be paying close attention to data releases from:
- Australia’s quarterly inflation release
- ANZ business confidence
- China’s manufacturing/service PMIs
Markets will be particularly focused on the quarterly CPI (Consumer Price Index) reading as a slump in inflation may put more pressure on the Reserve Bank of Australia (RBA) to ease momentary policy.
Currency traders will be keeping their ears to the ground listening out for the European Central Bank’s latest rate decision and preliminary GDP figures from both the Eurozone and US.
Question for next week - will the Aussie Dollar be buoyed by hopes that more countries will begin easing lockdown measures in the coming days?
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*Forecasts provided by TorFX TorFX Pty Ltd. AFS Licence number 246838. The information on this website has been provided for general information purposes only and must not in any way be construed or relied upon as personal advice.